The Financial Services Authoritys decision to scrap Reasons Why Letters was attacked at the Council of Mortgage Lenders annual conference today.
Ann Foster, chair of the Financial Services Consumer Panel, which operates independently of the FSA, says: “It is lamentable that the FSA is not saying that brokers have to do Reasons Why letters and I hope that, with the consumers interest at heart, that intermediaries will continue to do them.”
And John Parker, chairman of the Building Societies Association and chief executive of Stroud & Swindon, says: ” I dont understand the FSA ruling on Reasons Why letters and we still produce the equivalent.”
Parker also questioned whether mortgage regulation was entirely necessary in light of research unveiled by the CML today.
The research, conducted by BRMB, revealed that 79% of recent mortgage borrowers are very or fairly confident in dealing with their financial affairs and 90% thought their lender dealt openly honestly and fairly with them.
Parker and Foster both told delegates that honesty in the marketplace is also the responsibililty of the consumer.
Parker adds: “The most important piece of advice I could give is that lenders continue to under-promise and over-deliver.”